Comments on: The tragedy of long term unemployment A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 By: judyjs Tue, 30 Apr 2013 15:49:56 +0000 At least the construction industry was mentioned in your discussion. For California, the recession fights on. In construction you would think that 35 years in business matters but alas, the bottom line is price over quality. No matter if they can barelyy speak english or wether they have a license or not. The bottom line is price. The license board is so busy budting non licensed illegals, they can’t keep up.

By: brotherkenny4 Wed, 24 Apr 2013 19:02:30 +0000 To some extent it has to be considered the individual unemployed person at fault. There are actually many jobs out there. Sure, many are very low pay and many are doing things that are difficult and not fun. For some of us however, being unemployed is more unacceptable than having a crappy low paying job. Better jobs too, can be had with real education. Some of us in fact educate ourselves constantly throughout life because knowledge makes everything easier. Some have never learned that.

By: URising Wed, 24 Apr 2013 17:52:34 +0000 It appears after several years of little of no improvement in the situation, that long-term unemployment is a predicament that’s up to a few progressive politicians, the long-term unemployed themselves, and their advocates to work towards a creative remedy for. Sadly, at least as things stand today, most of “employed America” is far too focused on other things to really be inclined push for solutions–let alone hold an interest in the problem.

What would be the incentive for it to do so? Raising public awareness about long-term unemployment and its ramifications is very important to addressing it, but there’s an unfortunate risk that the attention of employed America will eventually “wear out” to ongoing discussion of it. After all, long-term unemployment as a topic of discussion is a “real downer.” But it’s important for us all to remember that it’s theoretically possible for almost any non self-employed worker in today’s economy to wind up unemployed for six months or longer at some point in their life.

The United States is one country, and whether we realize it or not–as oligarchs, employed workers, or unemployed job seekers–we’ll all have to live indirectly or directly with the consequences of inaction on reducing long-term unemployment. An obsession with implementing race-to-the bottom austerity policies prevails in today’s Washington and any concerted effort by the public sector or private employers to aggressively lower unemployment appears very unlikely to happen.

In the end, the inaccurate, prevailing thinking about the low potential workplace contribution of long-term unemployed will have to change. Closely-held stereotypes of the long-term unemployed as risky potential hires will need to be challenged, and widespread bias against workers attempting desperately to re-enter the workforce and fix their lives need to be fought at every turn and eventually defeated.

By: WallStLib Tue, 23 Apr 2013 21:25:58 +0000 Attempting to force corporations to hire is not likely to be particularly successful, based on the limited success that bribing companies in hiring has had. Worse, “efficiency gains” generally means that every year profits increase faster than employment costs (both total workforce and salaries), which is a dynamic that isn’t changing in the near future (if ever).

Krugman’s solution – restore government hiring (cops, teachers, file clerks and bureaucrats) – is at least efficient and effective (in that a lot of people can be hired fairly quickly). Unfortunately, the backers of deficit hysteria are fundamentally anti-labor, which means that they and their Congressional toadies are unwilling to countenance any pro-worker initiatives.

One potential solution is to attempt to cast renewed government hiring as a “family” issue in order to appeal to some less-radical social conservative. The tradeoff is likely to be the gutting of government worker protections (especially collective bargaining). Considering the success that state and local Republicans have had in that project already, a controlled descent with some immediate payoff may not be a terrible outcome.

THe alternative is a “free market” solution: step over the bodies and outsource the cleanup.

By: Chris08 Tue, 23 Apr 2013 19:06:56 +0000 It really isn’t a viable solution to devise things to punish companies for not hiring people. One thing alone determines hiring: demand for products. If you increase demand in general in the economy, the hiring comes along a natural effect. And often when the public is not flush enough to create more demand, you use government to create demand. Public works, subsidies to states to pay salaries of laid off public workers, etc., etc.

By: Matthew_Saroff Tue, 23 Apr 2013 18:26:40 +0000 Gee, when something is so bad that Megan “Math is Hard” McArdle gets the analysis right, it’s REALLY bad.

By: bittersweetone Tue, 23 Apr 2013 15:59:13 +0000 Felix, I would be interested in seeing the long term unemployment numbers charted with the construction industry, housing starts, commercial building starts.

Many of your readers are blaming the long term unemployed for lack of skills, which seems petty. Housing starts has traditionally been THE leading indicator for the state of the economy, and these days, it is less talked about. (Perhaps, because it has not recovered to any significant extent). Construction covers a large swath of laborers, from engineers and architects, (very highly skilled), to truckers, miners, lumberjacks and obviously construction workers. Few of these skill sets should need to be “retrained”. They have very valuable skills. I am guessing that a sluggish construction economy accounts for most of the long term unemployed.

By: QCIC Tue, 23 Apr 2013 13:51:44 +0000 There is a concept in Keynes I am sure you are familiar with. It is called “sticky wages”.

What happened in 2007 is that the economy finally shook out all the people whose skills have been made obsolete by the IT revolution. Some significant portion of those people have been unwilling to re-skill and/or reduce their labor demands to those of someone with no skill.

If you don’t have an extremely specialized knowledge or skill-set the relative to the value of your labor over just random college graduate who is good with a computer and has no other special skills has tanked.

You have tons of unemployed former directors and managers and machinists who used to be able to demand very good wages for skills that are no longer valuable. No that the economy has finally caught up to the reality of the labor situation they are having trouble adjusting.

By: TimWorstall Tue, 23 Apr 2013 11:46:34 +0000 Felix, you ought to know all of this, being a Brit and all. This is the focus of the work of Richard Layard who I’m sure you at least know of.

My annoyance here is the way in which everyone’s gasping as if this is some new and unknown occurence. When it’s been an absolutely standard part of the analysis of the European labour markets for decades.

By: FifthDecade Tue, 23 Apr 2013 09:17:54 +0000 While mfw13 illustrates clearly part of the problem is one of public perception, that there still IS a recession (there hasn’t been for some years mate!), dedalus illustrates the other mistaken view held by so many (particularly on the far right) based to a large degree it seems on Rogoff’s now discredited calculations that austerity is the way to get people to spend money (in effect, get growth back).

People need to take a step back – you can’t understand a forest by studying the bark of a single tree, no matter how many microscopes you bring to bear.

As for the unspent corporate profits, it is too easy for them to hide them overseas in tax havens. Instead of using this money for the sake of the business, as ‘silliness’ reports, their reaction is to demand more and more and more from their employees.

I know of people in multinationals who are under so much stress they work days off and cancel holidays to complete tasks where management have ceased to manage effectively because they are so busy looking after their own self-interest and not those of the company due to the stress they are under.

This results in them overspending on expense accounts, visiting the most expensive restaurants, ordering the best wines, cigars and other extras, staying on for extra days when on business trips so as to get a free ‘holiday’, always travelling business class and so on. In one location I know of, they are building a new open plan building to replace office units; cue – more stress, more bad behaviour from employees, less caring about the company. It’s called capitalism but in reality it’s collectivism. Short term share price gains perhaps, but long term, the company is slowly disintegrating.